1. Worries Over the Fed Delaying Interest Rate Cuts Continue to Weigh on Crude Oil Futures in Europe and the United States

2. European Diesel Supply Remains Uncertain, Amplifying Market Worries

3. Goldman Sachs Raises Summer Oil Price Forecast

Concerns over sanctions against Russia and shipping disruptions have pushed up European diesel prices, driving up crude oil futures. Maintenance at US refineries has also exacerbated the market shortage, causing international oil prices to rebound from early losses. On Monday (February 26th), the settlement price for West Texas Intermediate crude oil futures for April 2024 on the New York Mercantile Exchange was 77.58perbarrel,up1.09 or 1.43% from the previous trading day, with a trading range of 75.84−78.03. The settlement price for Brent crude oil futures for April 2024 on the Intercontinental Exchange in London was 82.53perbarrel,up0.91 or 1.11% from the previous trading day, with a trading range of 81−83.07.

The market believes that higher-than-expected inflation may prompt the Fed to delay interest rate cuts, and higher interest rates will inhibit the growth of global fuel demand. International oil prices continued to fall in the early trading session. Investors had previously expected a total of six to seven basis points of interest rate cuts for all of 2024 starting in March. However, with the release of US economic data and the Fed reducing those expectations, current projections based on the CME Fed Watch tool suggest that the possibility of the Fed cutting interest rates starting in June is now over 50%, and the Fed will only cut interest rates three to four times by the end of this year. Ricardo Evan geista, senior analyst at Aciv Trades, quoted by Market Watch on the Dow Jones website, said, “Inflation stubbornly hovering above the Fed’s 2% target, and the US economy showing unexpected resilience, the market is starting to price in a scenario where interest rates remain high for a long time. Against this backdrop, economic activity is expected to be affected, leading to downward revisions in forecasts for future oil demand.”